Zacks.com users have recently been watching Salesforce (CRM) quite a bit. Thus, it is worth knowing the facts that could determine the stock's prospects.
CRM's Data 360 momentum, AI-driven ARR growth and Informatica synergies are likely to support stronger fiscal 2027 revenue growth as customer demand expands.
Salesforce (NYSE:CRM) and ServiceNow (NYSE:NOW) stocks are both higher this morning, after Guggenheim upgraded the software staples to "buy," from "neutral," arguing that recent weakness has created attractive entry points.
Diane King Hall discusses this morning's top moving stocks at the opening bell, pointing to Phillip Securities downgrading Salesforce (CRM) and Adobe (ADBE). Arete also downgraded CrowdStrike (CRWD) to neutral from buy with a $730 price target.
Top software stocks have slumped this year amid the lingering concerns that artificial intelligence tools by companies like OpenAI and Anthropic will hurt their revenue growth in the long term. ServiceNow (NOW) stock is down by 35% this year, while Salesforce (CRM), Workday (WDAY), and Adobe (ADBE) have fallen by over 40%.
After initiating coverage in February 2026, CRM's stock is down by approximately 15%. Especially after the release of Q1-27 earnings, I view the opportunity as even more compelling today. Fears that Salesforce is about to get disrupted by artificial intelligence have become completely overblown, with the stock now trading at a free cash flow yield of ~11.2%. Agentforce and Slack increased revenue by 43% in Q1 '27, a meaningful acceleration versus the 14% and 37% reported in Q1 '26 and Q4 '26, respectively.
Salesforce has declined 33% since my last coverage, underperforming the benchmark's 13% gain. I maintain a strong buy rating on CRM, citing undervaluation and robust fundamentals despite AI-driven uncertainty. CRM continues to deliver above-market margins and a compelling bottom-line growth story.
Salesforce (CRM) reported earnings 30 days ago. What's next for the stock?
I have a $386.80 intrinsic value for Salesforce. With the current price of $150.12, this represents a 158% upside. I believe CRM is getting thrown out with the proverbial bathwater due to the fear that AI capabilities are making legacy software business models obsolete (SaaSpocalypse). CRM has over 20 years of formulating customer relationships AND gaining their trust in collecting their data, analyzing/utilizing it, and designing custom enterprise/vertical workflows. That is not something that can be.
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Salesforce has experienced a sharp decline, falling over 40% since January and hitting multi-year lows. Despite this outsized fear, Salesforce is actually delivering revenue acceleration, and is planning for continued top-line acceleration in 2H'27. ARR in Agentforce is growing at more than a 2x y/y clip, proving that Salesforce's AI innovation are driving true monetization rather than just a rebrand.
Salesforce (CRM) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.